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Jane Kinsella
The Real Estate Company Ltd.
11, 5080 12A St. SE, Calgary, Alberta
P: 403-874-6143
F: 403-476-5467
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Monday, May 17, 2010 - Alberta Housing Affordability

Bursting the Alberta Housing Myth

The 2009 real estate market started out slow and ended with a bang. With prices and interest rates plummeting, many consumers took advantage and became homeowners.

2010, however, has been shrouded with whispers of a housing boom, with some suggesting that prices are creeping up to the staggering highs of 2007.

REALTORS® know differently and can use the following statistics to demonstrate to prospective clients that, while the economy has raised real estate costs, Alberta boasts some of the most affordable house prices in Canada.

Housing prices are region-specific. Housing on the West Coast and in southern Ontario costs exponentially more than Alberta’s reasonably priced real estate, highlighting that the pricing is specific to different regions of Canada.

o Average prices in Edmonton are as much as 7.5% lower than the 2007 peak, with a similar trend in Calgary.

 

o In a side-by-side comparison, the average house price (including condos) in Toronto was up to $438,600 in March, 2010. Edmonton came in at about $330,000, according to a Scotiabank report.

 

Alberta homes are affordable when local factors are taken into account. Alberta homes score high on the attainability scale, a measure that compares local average income with average house prices.

o A study by RBC Economics (http://www.rbc.com/economics/market/pdf/house.pdf) that measured the percentage of median pre-tax combined household income needed to cover a 25-year mortgage at market prices, put Edmonton and Calgary in the spotlight for affordability*:

- Edmonton: 32.9% of combined income was needed for a typical bungalow

- Calgary: 37.1%

- Toronto: 49.1%

- Vancouver: 69%

- National average: 40.6%

* The fourth quarter of 2009 was the last period covered

Compare that with a Pitney Bowes Business Insight study, which documented median combined household income in Canadian cities:

- Edmonton: $90,000

- Calgary: $113,000

- Toronto: $101, 400

- Vancouver: $82,300

These statistics paint a picture of affordability within the Alberta market.

posted in General at Mon, 17 May 2010 16:22:15 +0000



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